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Sum-insured policies base
what you would pay for your insurance on what
it would cost you to replace all your possessions
(for new-for-old cover) or what they are currently
worth (for indemnity cover).
This figure is the ‘sum insured’.
Unless you have your insurer’s specific
agreement to exclude some of your possessions,
the sum insured should include everything
you own.
It is your responsibility to get the sum insured
right.
If the figure is too low, it will not reflect
the true replacement values of your belongings
and you will be under-insured – meaning
that any claims you make will not be paid
in full.
If it is too high, you will be over-insured
and paying above the odds for your policy:
over-valuing your possessions does not mean
that you will be able to claim for higher-specification
items as the insurer will verify their cost
before paying out.
What is the sum insured?
With a sum-insured policy, to arrive at the
total amount you should be insured for add
together the total of your high-risk items
and the total for the rest of your belongings
(after making a deduction for normal wear
and tear for clothes and linen, as above)
and round this figure up to the nearest thousand
pounds.
You must insure
all your contents for the right amount –
if the total sum is too low, whatever amount
the insurer pays out will be scaled down proportionately
as clawback for under insurance!!
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UK
CONTENTS INSURANCE ONLINE
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